AHLA urges Congress for additional funding for small hotels

Eloise Hanson Eloise Hanson Uploaded 29 April 2020

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US: The American Hotel & Lodging Association (AHLA) has released a new report that reveals small business hotels will require additional SBA loan funding under the Paycheck Protection Program (PPP) to prevent loss of jobs and closure.

The report shows that “covered costs” as defined in the CARES Act covers only 47 per cent of hotel operating costs. If the CARES Act is amended to raise the loan limit from 250 per cent to 800 per cent of covered costs, most hoteliers could keep employees and their doors open.

The AHLA has therefore sent a letter to Congress, signed by more than 13,000 hoteliers from all 50 states, requesting additional SBA loan funding and updates to the CARES Act.

“The CARES Act is an historic effort to meet the most serious health and economic challenges of our lifetime, and the hospitality industry recognises and applauds every elected official who has helped meet these challenges,” said Chip Rogers, President and CEO of the AHLA. 

“The policy solutions and technical corrections we offer do not overshadow the gratitude we have for the work already done to help save our industry. The additional funding and needed changes to the CARES Act are directly related to our only interests: saving jobs of our employees and supporting our small businesses.”

61 per cent of US hotels are defined as small businesses. Given that occupancy is not projected to return to pre-crisis levels before 2021 and revenue until 2022, these small business operators would be in a worse cash flow position from utilising the PPP under the current limits.

Rogers added: “The hospitality industry is truly engaged in a fight for survival. The human toll is measured in millions of jobs lost, and nearly half of all hotels are functionally closed. If small business hotel owners can’t pay the mortgage or utilities, they will have to close their doors with no jobs for employees to come back to work. We are doing everything we can to ensure those jobs aren’t lost forever.”

The full report can be downloaded here.

The AHLA is the national association representing all segments of the US lodging industry, headquartered in Washington D.C.

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